A very important component of any real estate transaction is the review of a current survey no more than 90 days old of the subject property. I’m going to discuss three aspects that I think are particularly important when reviewing a survey prior to closing a transaction.
- Legal Description. The legal description on the face of the survey should be identical to the legal description on the title commitment and the closing documents, particularly the deed conveying the subject property. Any discrepancy between the legal description on the survey and the legal description on the deed of conveyance or title commitment could potentially lead to a title defect. In addition, its good practice to make sure the calls and the written legal description match the calls identified on the face of the survey. Any discrepancies or problems with the legal description should be resolved prior to closing and a survey can assist in identifying those issues.
- Title Commitment. Typically with any real estate transaction, a title commitment is a obtained during the due diligence period. The title commitment is important because it will reveal any publicly recorded easement or encumbrances that affect the subject property. The surveyor should be provided a copy of the title commitment and exception documents so that he or she can locate those easements on the survey. Depicting on the survey the location of any easements encumbering subject property assists in determining whether such location impacts the intended use of a subject property.
Encroachments and Access. Often times encroachments and access are items not included in the public records. Therefore, it’s important to pay close attention to these items when reviewing the survey Common examples of encroachments are fences and driveways. A more serious type of encroachment is of a building or structure. If the survey does reveal an encroachment determination must be made whether that encroachment can be relocated and whether there are any prescriptive rights associated with the encroachment. Finally, if the subject property has access to a publicly dedicated right away the survey should verify that. Review of a survey is a vital component to any real estate transaction. A survey can help identify problematic issues that must be resolved prior to closing a transaction to avoid problems in the future. Therefore, I highly recommend obtaining a survey prior to closing any real estate transaction whether commercial or residential